The viability of healthcare reform

Fri, 04/02/2010 - 9:32amD.W. MacKenzie

Now that the healthcare reform bill has been signed, it will face legal challenges in courtrooms. However, the judges in these cases do not possess the authority needed to render a final verdict on healthcare reform.

The success or failure of healthcare reform ultimately depends upon whether or not it conforms to economic laws, rather than with the opinions of judges.

In order to judge healthcare reform by economic laws, we must ascertain its nature. The single payer and public option versions did not pass. However, Americans will be required to have health insurance, and employers will be pressured to provide it. Congress is funding healthcare through explicit taxes and new mandates for buying or supplying “private” health insurance.

Mandates amount to implicit taxation. These explicit and implicit taxes amount to a de-facto single payer. Since healthcare is headed towards political control, we must ask if this will result in a more efficient or more just outcome.

The healthcare industry is complex and subject to constant change. Complexity and change make industrial planning difficult. Plans must be adapted continuously through time. If the authors of healthcare reform knew about all change in advance, they could have written a bill that accounts for every contingency. Healthcare reform will actually be a permanent work in progress.

The fact that healthcare reform will be revised casts doubt upon the Congressional Budget Office forecast of financial savings. Given that this legislation will be revised — and has already been changed — we cannot assume that CBO numbers will remain true.

The CBO also predicted that Social Security would generate surpluses until 2016, but this system recently went into deficit. The costs of public programs tend to rise over time, but why?

Ideally, legislators pursue what some term “social justice” through redistribution. Everyone favors “justice,” but people have different opinions as to what constitutes a fair distribution of wealth.

No one comprehends all the factors that would have to enter into an actual estimate of “socially just” income distribution. Since “social justice” has no objective meaning, the pursuit of this goal always degenerates into power struggles among interest groups.

The reality of politics is interest groups competing for influence. Competition often controls costs, but not in politics. Political competition favors narrow and concentrated interest groups. Small interest groups organize more easily and divide gains fewer ways relative to larger groups.

Individual citizens cannot appreciably affect politics, and “the people” as a whole are too diverse and dispersed to organize against special interests.

Politics is driven by a few political powerbrokers (i.e., the Speaker of the House) and special interests. Anyone who believes that healthcare regulation will, as President Obama has put it, serve the American people, does not understand the economics of politics: special interest groups wield disproportionate influence and impose wasteful transfers.

We can see the failure of politics in Medicare. Medicare has problems with waste and is underfunded. The underfunding of Medicare is not an honest mistake. Politicians knew about the costs of baby boomer retirement decades ago, and they failed to set aside funds to cover these costs. They took the politically popular — and financially unsound — path of profligate spending and low taxes relative to obvious future burdens.

Americans who want to move in the direction of publicly financing healthcare have the best intentions. However, there is no way of realizing dreams of social justice or improved efficiency through politics.

The term “social justice” lacks any real meaning. Economic laws and history indicate that public programs result in wasteful transfers to special interests.

Healthcare does need reform. We should consider using the only system that really controls costs: competitive free enterprise.

[D.W. MacKenzie, Ph.D., is an adjunct fellow at the Independent Institute in Oakland, Calif., and a professor of economics at the U.S. Coast Guard Academy. The contents of this article do not constitute official views of the U.S. Coast Guard.]

Here's some help: <strong>If you are covered under a health insurance policy issued by an insurance company (i.e. the government is not paying your doctor directly), by definition it's not "single payer"</strong>

No amount of conservative teeth gnashing can change that underlying fact.

You are semi-correct for now.. Only because they could not get it to pass. It is a step process.. but then again I have already shown this to you. Your'e just to "PIG" headed to admit it.

"August 4, 2007

OBAMA: This is a two trillion part of our economy. And it is my belief that, not just politically but also economically, <strong>it's better for us to start getting a system in place, a universal health care system signed into law by the end of my first term as president, and build off that system to further, to make it more rational.</strong>

...By the way, Canada did not start off immediately with a single payer system. <strong>They had a similar transition step."</strong>

"April 3, 2007

OBAMA: Let's say that I proposed a plan that moved to a single payer system. Let's say Medicare Plus. It'd be essentially everybody can buy into Medicare for example.

...<strong>Transitioning a system is a very difficult and costly and lengthy enterprise. It's not like you can turn on a switch and you go from one system to another.</strong> So it's possible that upfront you would need not just, I mean, you might need an additional $90 or $100 billion a year."

"March 24, 2007

OBAMA: But I don't think we're going to be able to eliminate <strong>employer coverage immediately.</strong> There's going to be potentially some <strong>transition process. I can envision a decade out, or 15 years out, or 20 years out."</strong>

Reason being is that things and people and politicians never change. Samo, samo. Over and over again. When will we ever learn?

I hope that the revolution coming to this country is confined to the voting booths in November. I fear for this country and I am scared for the thousands of unemployed - especially the young families with kids. What are they going to do? How can they get rid of this cancer in Washington.

<em>"Healthcare does need reform. We should consider using the only system that really controls costs: competitive free enterprise."</em>

PTC Observer, the tired "free market can cure anything" solution has been proven not to work in America. The free market approach to healthcare in America resulted in such things as denial of pre-existing conditions, lifetime caps on benefits, random and arbitrary cancellations of policies, and most importantly, the lack of access to healthcare for upwards of 30 million American citizens.

The free market approach to health care was broken. Congress and President Obama fixed it.

No one has suggested that the government take over health care in America, and anyone who believes that the recently enacted health care reform legislation does so has no clear understanding of the legislation.

The government now steps in and provides a "safety net" for those 30 million plus Americans who lack access to affordable health care. The vast majority of Americans will see very few changes to their existing health care coverage. The changes they will see are largely beneficial to consumers: no existing condition limitations, no lifetime caps, children covered up to age 26, etc.

The government has been running health care since 1967 (in a big way); since its intervention health costs continue to rise faster than inflation. Government intervention has not improved health care it has damaged health care. If health care is broken it is because of government not because free markets don't work.

The free market does not exist in this country, especially in health care.

But I am going to be forced into this by a bloated government that can't even run itself. Now it will be running my body. Just when you thought it was safe, we now have our government to "take care of us". No thanks.

"The vast majority of Americans will see very few changes to their existing health care coverage. The changes they will see are largely beneficial to consumers: no existing condition limitations, no lifetime caps, children covered up to age 26, etc"
and I see my premiums skyrocket as people with serious preexisitng conditions get coverage, does that mean that you will admit that you are wrong and work to change the direction of our country?
I have a relative that has a "pre-existing condition" that requires him to have an IV therapy every two weeks for $10,000 a pop. If he, and more like him, swoop in for coverage, how long will the insurance premiums remain at current rates and how long before price controls are implemented? Price controls always increase supply, right?

I recognize that you and your fellow travellers (Lindsey, PTC Observer, meanoldconservative and Joke Awfi) are hard-wired to blame most everything wrong in America on nefarious "government intervention".

So I propose a test to see who has a better understanding of the effects of the recently enacted health care legislation, your side or mine:

I'd like you to post, as much as you can recall, the PERCENTAGE INCREASE of your health insurance premiums over the past two or three years. Additionally, if any part of your health insurance coverage was cut back, eliminated or decreased, please let us know that as well.

This will establish a baseline to test your hypothesis that your premiums will "skyrocket".

Let's see in a year or so if your premiums have increased, decreased or remained stable...and if your premiums do increase, let's see how the increase compares to previous rate increases and the rate of inflation.

Heck, if you're willing to do this I'll go dig up my old health insurance premiums too! Any other folks on this forum want to play?

Here's your chance to rub a liberal's face in it IF you have guessed correctly....of course, you run the risk of the opposite happening if you guessed wrong.

Who has more credibility? Here is my baseline. btw.. No changes in premiums for the last 3 years.. Coverage has increased however 8%..

Summary of Findings: <cite>The effects of the proposal on premiums would differ across insurance markets (see Table 1). The largest effects would be seen in the nongroup market, which would grow in size under the proposal but would still account for only 17 percent of the overall insurance market in 2016. The effects on premiums would be much smaller in the small group and large group markets, which would make up 13 percent and 70 percent of the total insurance market, respectively.</cite>

<cite>Nongroup Policies CBO and JCT estimate that the average premium per person covered (including dependents) for new nongroup policies would be about <strong>10 percent to 13 percent higher in 2016 than the average premium for nongroup coverage in that same year under current law.</strong> About half of those enrollees would receive government subsidies that would reduce their costs well below the premiums that would be charged for such policies under current law.</cite>

<cite>No changes in premiums for the last 3 years.. Coverage has increased however 8%..</cite>

Does this represent YOUR personal insurance program? (just asking for clarification since your reality is so different from mine - please don't respond to a personal question) Was there an increase before three years ago? Are you part of a pool? The reality is that most people of the ME GENERATION are concerned about 2010 - 2012 today. They'll hope that they will be part of a group in 2016 - right?

<strong>About half of those enrollees would receive government subsidies that would reduce their costs well below the premiums that would be charged for such policies under current law.</strong>

I shop my insurance as best I can under current State laws if I could go out of State I could SAVE even MORE.

I therefore OWN my on plan and control my cost.. I PAY for my own insurance and therefore control my cost.

My reality only differs from yours because I believe in personal responsibility and you believe the Government should "GIVE" it to others.. It's part of that whole ENTITLEMENT MENTALITY. You feel you are entitled to it be your mere existence. I don't simple.

I don't expect the Government to GIVE me anything.. those subsides are just more WELFARE given to a class of people to make them SLAVES to the Government.

"Whoever claims the right to redistribute the wealth produced by others is claiming the right to treat human beings as chattel."

<cite>My reality only differs from yours because I believe in personal responsibility and you believe the Government should "GIVE" it to others</cite>

Respond to me based on what I have said - and not what you have been told to say to 'liberals'. I HAVE NEVER STATED THAT HEALTH INSURANCE SHOULD BE GIVEN TO ANYONE. I believe that all Americans should be able to receive AFFORDABLE health care. THAT'S NOT GIVING A SERVICE TO ANYONE IN ORDER TO STAY HEALTHY IN THIS COUNTRY.

By the way - many 'American citizens' go to other countries daily for medication and health care. Check the pharmacies of our neighbor to the south and the drug stores of our neighbors to the north.

I fought for many years to make the welfare system of the United States change from forcing minority men out of their homes so that their children could EAT!
The movie CLAUDINE helped to bring the ugly reality of that former welfare practice to the conscience of America. The program FROM SCHOOL TO WORK is another program that is helping to break the generational cycle of those on 'welfare'. In this present economical situation - where too many of our families are being headed by a man or woman who is jobless, it is critical that we take steps to provide jobs, insure affordable healthcare for families, and provide for homeland security and defense of our country from foreign enemies. There may be different ideological roads for achieving these steps. We have seen what one ideology has done for us. The American people are looking at other answers.

I responded to YOUR statement that your reality is different than mine..

WAS I WRONG? IS THAT WHAT YOU SAID?

So when I respond to your comment you go off and say you fought for change in the welfare system.. WE will explore that remark later..

When you take from the productive class by force and GIVE it to the recipient class for FREE that is GIVING a SERVICE to some one DM. It is not yours nor the Government responsibility to see to it that EVERYONE stays healthy.

When does that slippery little slope stop? In order for the Government to insure that EVERYONE is health.. well then we need to ban all sweets and sugars.. How about all foods with over 500 calories and 25 carbs.. and well certain activity's are un-healthy too. Let's ban all sports and well I could think of a hundred more things the Government needs to ban to insure we all are HEALTHY DM.

It is not yours or the GOVERNMENTS RIGHT to force me to pay for others actions.

"Whoever claims the right to redistribute the wealth produced by others is claiming the right to treat human beings as chattel."

<cite>and you believe the Government should "GIVE" it to others</cite>

I clarified your misstatement about what I believe. This bill - and it will be amended throughout the years - is a start to make HEALTH CARE AFFORDABLE for all citizens. Right? The miniscule amount that YOU pay in taxes is not enough to pay for my healthcare. Citizens, groups, organizations pooling their money helps to bring down the cost of any commodity - including healthcare. You and yours scream for getting the same care as our Congress - well now some will have that opportunity. Enjoy your day - I will!

that I have ever said I want what they got.. THEY get what they get because they are elected.. I am not. My job allows certain perks.. theirs allow for perks as well.

That's class envy and that's YOUR game don't get me confused with a democrat.

EVERY expert in the field has said THIS BILL WILL MAKE PREMIUMS GO UP not DOWN...!!!

<cite>WASHINGTON (CNN) -- Health insurance premiums for the typical American family would increase by another $4,000 by 2019 under a key Senate overhaul plan, according to an industry trade group analysis.</cite>"

<cite>"Individual insurance premiums would increase by an average of 10 percent or more, according to an analysis of the Senate healthcare bill.</cite>

<cite>The long-awaited report by the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) also concluded that subsidies provided by the legislation would make coverage cheaper for those who qualify."</cite>

<cite>"Under the health care overhaul, young adults who buy their own insurance will carry a heavier burden of the medical costs of older Americans - a shift expected to raise insurance premiums for young people when the plan takes full effect."</cite> Washingtonpost

How is this making Healthcare affordable? It is only if you count it as an entitlement that the rest of the productive class has to pay for..

"Whoever claims the right to redistribute the wealth produced by others is claiming the right to treat human beings as chattel."

One of the main reasons that a new revision of our health plan was implemented was that the costs were increasing around 20% every year or near that!

So they would double every four years roughly!

Of course health costs including insurance will continue to rise!
Let us hope however that better controls will hold it to 5-10% instead of 20%!

We were headed for catastrophe in costs!

Actually this complaint of cost increases is a trojan horse substituting for the real reason.....the complainers wish they had gotten it done first. There is no takeover of health care or of industry. Just trying to save them.

You are really not worth the effort.. but me and lost causes and all that..

If as you say Premiums were doubling every 4 years.. When did the premiums start to rise?

If it went up 100% in 8 years than that 30 million "uninsured" would have probably doubled as well. The fact is some premiums have gone up why?

Well according to industry analysis the cost has risen due to forced regulations placed on the Industry by the Government and the fact that they have been mandated in many states to take "risky" policies.

The amount the risk goes up the rest of the "Healthy" has to pay for it.

"Whoever claims the right to redistribute the wealth produced by others is claiming the right to treat human beings as chattel."

The free market approach does not work in America? REALLY? Is that why everyone wants to come here to be seen by OUR doctors.

No one has suggested the government take over health care in America. REALLY? Are you blind man or did you not see the government DO JUST THAT on March 21, 2010. Maybe you did not understand what they did when they voted to TAKE OVER HEALTH CARE IN AMERICA.

On top of that, no one can get the numbers right on who is uninsured not by choice, not even Obama or Congress. We have anywhere from 46 million to 30 million depending on how you want to spin it and who is spinning it. The real numbers are probably around 8-15 million of which we have so many options to help them and still keep the cost down. For that matter let's use some of that stimulus money to help the poor. Oh wait that would not be redistributive wealth management which we now MUST HAVE in America.

[quote=Chris P. Bacon]<em>
<strong>No one has suggested that the government take over health care in America, and anyone who believes that the recently enacted health care reform legislation does so has no clear understanding of the legislation.</strong>

The government now steps in and provides a "safety net" for those 30 million plus Americans who lack access to affordable health care. The vast majority of Americans will see very few changes to their existing health care coverage. The changes they will see are largely beneficial to consumers: no existing condition limitations, no lifetime caps, children covered up to age 26, etc.[/quote]
<p>
Fatback,
I would venture to say that probably 85% of the congressmen and women that voted for it don't understand it. Even some Democrat senators like Sen. Thomas Carper a member of the Senate Finance Committee, admitted to not fully understanding it.
<p>
Have you ever heard of a slippery slope? That's what we're on. You know it, I know it and this administration knows it, but they are hoping that the emotional connection people have to the poor and children and elderly will make them blind to the big picture. Little by little they'll creep in till one day we'll wake up and...voila...Government Healthcare. Hey nobody thought a President would fire the CEO of a major corporation and handpick a replacement either, but Obama did.
<p>
Is it 30 million Americans that "Can't" get healthcare or is it 30 million Americans that "lack" healthcare? Those are two TOTALLY different things. Just because you lack something doesn't mean you can't get it.
<p>
You people are going to give away America!

Unregulated 'free-enterprise' benefitted the corporations, lobbyists, and professional politicians. That's why we're in this mess today - after more than twelve years of citizens allowing 'others' to be OUR government. Thank you for clarifying your views. I don't agree with you - but rejoice in a system where we can both express our views. We're not a socialist country - and never will be. When one finds dishonesty - it is their responsibility to present that which they consider the 'truth'. That is allowed to happen in a free society - not a socialistic society.

Are you actually suggesting that over the last twelve years we have lived in an "unregulated "free-enterprise" society? Really?

The only thing you are rejoicing in at the moment is that people like me don't have any power in this society. That way you can just keep rationalizing robbery, but remember this, the laws of economics have not been repealed. It is just a matter of time before the country will be destroyed by "democracy".

Thanks PTC Observer for pointing out that YES in fact our country has instituted socialistic programs for a very long while and though we may not be a full blown socialist country the government now controls 1/6th of our economy. The founding father's never set up America this way and we need to return it to the original plan.

David's Mom you might want to read the 5000 Year Leap you can get it on Amazon for almost nothing and it has a copy of the Constitution, The Declaration of Independence, and De Tocqueville's writing on Democracy in America.

I've read all that and more - and as a women and a minority in this country - I never want to see us 'return' to the less than ideal practices of our country. We, as a people, are progressing to live up to the 'words' of the Constitution - and although we have not reached the ideal in our practice of those words - we are admired the world over for what we have accomplished here in the United States of America. . . and we continue to grow!! A well-rounded education is the best policy. . coupled with honesty of the reality of what this country has accomplished since the days of its founding.

<cite>No one cares if you are a women or a minority, you are simply another citizen.</cite>

My dear friend - it has taken me and mine many, many years to achieve the status of just 'another citizen'. I have been classified, re-classified for most of my life - starting from birth in this country!! I have fought hard and long for that status (just another citizen) - and will fight tooth and nail before I allow anyone to deter the progress that has been made for women and minorities in this country. I have no idea what your skin color is or your gender - but those who share my gender status or my skin color CARE A LOT - and so do many others who might be considered 'different' from me - but joined in the fight for equal recognition for all citizens! Because of my current status as 'just another citizenâ€™, there are many citizens of the world who admire our country and hope to achieve what we have achieved here in the United States. It wasn't easy - and many suffered in the throes of the battle . . . but we're here with equal voice in the discussion!

If you happen to be a woman â€“ did you realize that some insurance companies, before the passing of this bill, could consider it a pre-condition if you had a problem during childbirth? BEING A WOMAN WAS A PRE-CONDITION FOR MANY!! Now, we have equal access as men â€“ who would never have some of the health concerns that come naturally with being a woman.

You are just another citizen, it's just that simple. Your not special because you are a minority nor are you special because you are a woman.
That's what equal rights is all about, that's what we fought for and it is acheived. You are equal.

Now citizen,

I repeat, the government does not owe me health care, I don't want to be taken care of by the government. I don't want to ask my representatives to steal for me, I don't have the right to steal. I can't give this "right" to my representatives because I don't have that right.

The nanny state reduces and minimizes my individual freedom to take care of myself, my family, and those that I care about. The government is trying to replace personal responsibility, personal intiative, and is destroying the family unit by becoming my proxy. I object to this.

It's interesting that I speak well of my country, my responsibility to my government, and acceptance of the pluses as well as the minuses of our government - and PTC (I don't know what label this person prefers other than the one I cherish - citizen - sees no hope for the future of the United States because of 'our government'. I'm beginning to think that if any other person were President - this PTC would be a happier citizen. There are communes that PTC could move to and live the 'liberated, individual lifestyle' that PTC professes to admire. Peachtree City is about as far removed from a commune as one could get! Oh well, I'll be accused of playing the 'race card' again - but geez, the future of living in the US and especially in Peachtree City can't be that bad!!

I suppose I'm going to have to tell you this:
The "Constitution as it is written" as you say, is practically worthless as a method of governing 3-4,hundred million people.

"A well regulated militia." what the devil is that?

It is a simple document to be used as a guide, mostly then and not now.

If that were not so, why would we have changed it so much over the last 200 or so years? (interpretations by the Supremes).

You must understand that people are more important than any document written primarily for the protection of the educated elite and commerce.
If not we wouldn't have allowed slavery and women's right to falter.

If you havenâ€™t noticed, I have not communicated with you very much; the reason is that I have made it a practice not to have â€œdebateâ€ with those that are intellectually defenseless.

I hope you understand that it is nothing personal; itâ€™s just that you donâ€™t make much sense and I question whether or not you have the intelligence to carry on any type of dialog in a rational and logical manner.

This will be my last response to anything you may happen to say. I really donâ€™t want to encourage you.

Please - I know that you're excited and involved in the discussion - and we all make mistakes. Please use the correct spelling of 'you are'. It is not 'your'. The contraction for 'you are' is you're. Thanks.

Now I know that I'll be criticized for making this correction - but these individuals have intelligent and articulate arguments - and their ideas should not be discredited because of 'mistakes'.